Commissioner James Danly Statement
September 14, 2021
Docket No. CP17-40-009

Today’s order issues a temporary certificate to Spire STL Pipeline LLC (Spire) under section 7(c)(1)(B) of the Natural Gas Act (NGA),[1] the purpose of which is to allow Spire to continue operating its pipeline system following the issuance of the court’s mandate which will vacate Spire’s certificate.  Such an issuance is necessary should the Commission wish to ensure continuity of service and we know beyond doubt that “[n]o single factor in the Commission’s duty to protect the public can be more important to the public than the continuity of service furnished.”[2]  This duty is all the more important immediately ahead of winter.  And while I understand how critical it is to ensure service continues uninterrupted and I appreciate the circumstances faced by Spire, I cannot vote for this order because it violates the NGA and the Administrative Procedure Act (APA).     

The majority is correct when it declares that, “the Commission may issue a temporary certificate in cases of emergency, to assure maintenance of adequate service or to serve particular customers, without notice or hearing, pending the determination of an application for a certificate.”[3]  This is an exception to the statute’s ordinary requirement that the Commission notice and set for hearing all certificate applications and approve or deny certificates based on whether a proposed facility is in the public convenience and necessity.[4]  And I agree with the majority and the commenters who said that dire consequences may attend a cessation of service.  The present situation, however, is simply not the type of emergency contemplated by the statute.  The courts have explained that section 7(c)(1)(B) has limits: “it was designed as a narrow exception to enable the companies and the Commission to grapple with temporary emergencies and minor acts or operations, like emergency interconnections to cope with breakdowns or sporadic excess demand for gas.”[5]

This is not what we face here.  This case is not about broken compressor stations, breached pipelines, or unexpectedly cold weather.  Instead, what we have on our hands is an unlawful Commission response to the judicial vacatur of a certificate, itself a chastisement for our failure to adequately explain our decisions.  In other words, the Commission did not satisfy its obligations under the APA in the first instance.  Section 7(c)(1)(B) is simply inapposite.  The present circumstances, an “emergency” of our own making, is not the kind of emergency for which section 7(c)(1)(B) was drafted.  And we need not argue this from first principles.  The courts have already considered (if only as dicta) the very question of whether our emergency powers can be employed as a stopgap in the absence of a certificate.  In Algonquin Gas Transmission Company v. FPC, the court stated that “it is by no means clear [that] the statutory phrase ‘to assure maintenance of adequate service’ would be construed to include maintenance of a natural gas service no longer authorized by a valid outstanding certificate issued by the Commission under the provision of the Natural Gas Act.”[6]  And this makes sense.  If the purpose of the provision is to allow for narrow orders to be issued in emergencies for the specific purpose of maintaining service provided by legally-operating pipelines, a certificate of public convenience and necessity would seem a necessary prerequisite.

The majority responds by arguing that “the emergency is the breakdown in service to existing customers that may result from the cessation in operation of a functioning pipeline”[7] and likens this emergency to “emergency interconnections to cope with breakdowns or sporadic excess demand for gas.”[8]  I find this reasoning convenient, not believable.  These are not analogous.  It also does not explain the Commission’s delay in acting.  In the face of an emergency, why would the Commission notice Spire’s request for a temporary emergency certificate for a 30-day initial comment and 30-day reply comment period?  The imminent cessation of service during the upcoming winter season was a possibility then just as it is now.  Yet, the Commission not only declined to use its emergency authority then but established a proceeding that deviated from standard practice.  Moreover, how can the Commission find there is an emergency warranting a temporary certificate and still “evaluate[] Spire’s temporary certificate application and the arguments raised in the responsive filings”?[9]  The Commission absolutely cannot issue a temporary certificate merely because there is an ongoing dispute regarding whether there is in fact an emergency.[10]     

In sum, this order is unlawful.  In order for the Commission to issue a temporary certificate under NGA section 7(c)(1)(B), it must provide an adequate, reasoned explanation for why there is an emergency as contemplated by the statute.  Failure to do so is a violation of the NGA and APA. 

Legal deficiencies aside, the predicament the Commission faces in this proceeding—that it must issue an unlawful order to maintain continuity of service—is a Hobson’s choice of its own creation.  The Commission could have taken several steps, all simple and prudent, to avoid finding itself in its present dilemma and I would not be in the position of voting against an order designed to continue service that I agree, at least for the time being, is needed.  

First, the Commission could have noticed Spire’s application with a comment period consistent with its standard practice when considering certificate applications—that is, twenty-one days for comments and interventions and no reply comment period.[11]  Doing so would have provided the Commission greater flexibility to react to the court’s mandate, which could have issued as early as August 13, 2021. 

Instead, on August 6, 2021, at the direction of the Chairman, Commission staff noticed Spire’s application and set September 7, 2021, as the deadline for initial comments, and October 5, 2021, as the deadline for reply comments.[12]  And as a result, the majority is reacting to the mandate, creating new sub-dockets,[13] acting “sua sponte,”[14] and in the end issuing a temporary certificate without notice and hearing—all to get around the fact that, under the timeline the Commission created for itself, reply comments are not due for another twenty-one days.  Noticing Spire’s application for the standard 21-day comment period would have obviated the majority’s need to engage in the acrobatics we see in this order by providing the Commission the procedure necessary to issue a certificate under NGA section 7(c) and (e)[15] for the winter season as the Commission considers what to do on remand.  Such order could have met the statutory requirements that the Commission notice and set for hearing the application and approve or deny the certificate based on whether the proposed temporary service is in the public convenience and necessity.    

Second, the Commission should have sought rehearing of the court’s vacatur of Spire’s certificate order.  Vacatur is an extraordinary remedy and, while the court was correct to instruct the Commission regarding its failure to properly explain its decisions, the court misapplied Allied-Signal, Inc. v. U.S. Nuclear Regulatory Commission,[16] and we should have sought rehearing.  But, despite support among a majority of my colleagues to seek rehearing, the Chairman declined to do so.[17]  Had the Commission itself sought rehearing, the court may have reversed its decision to vacate the Commission’s order and the Commission could have taken the time it needed on remand to either justify its decision to the court’s satisfaction or taken any other steps it deemed necessary.

Third, at the very least, the Commission should have sought a delay of the issuance of the court’s mandate or should have supported Spire’s request to stay the mandate.  Nothing could have been lost by making such a request.  It would have afforded the Commission time to issue a durable order that conformed to the procedural requirements of the NGA. 

My colleagues may believe that their 90-day temporary certificate provides certainty or solace to the City of St. Louis.  This is misguided.  This temporary certificate will lift December 12, 2021, not even halfway through the winter season.  I question the reasons for issuing a temporary certificate for any period shorter than the whole of winter.  One wonders why the Commission has taken such a parsimonious approach toward Spire when it was the deficiency of our order, not any action of Spire’s, that has put us where we are.  The Commission must fix this infirmity in a manner that is legal and in the public interest. 

For these reasons, I respectfully dissent.

[1] 15 U.S.C. § 717f(c)(1)(B). 

[2] Sunray Mid-Continent Oil Co. v. FPC, 267 F.2d 471, 473 (10th Cir. 1959); see also City of Mesa v. FERC, 993 F.2d 888, 895 (D.C. Cir. 1993) (stating that part of the Commission’s mandate “is a duty to assure that consumers, especially high-priority consumers, have continuous access to needed supplies of natural gas.”).

[3] Spire STL Pipeline LLC, 176 FERC ¶ 61,160, at P 6 (2021) (quoting 15 U.S.C. § 717f(c)(1)(B)).

[4] See 15 U.S.C. § 717f(c)(1)(B) (requiring the Commission to set a certificate application “for hearing and shall give such reasonable notice of the hearing thereon to all interested persons . . . and the application shall be decided in accordance with the procedure provided in subsection (e) of this section and such certificate shall be issued or denied accordingly”).

[5] Consumer Fed’n of Am. v. FPC, 515 F.2d 347, 353 (D.C. Cir. 1975); see also Penn. Gas & Water Co. v. FPC, 427 F.2d 568, 574 (D. C. Cir. 1970) (“It appears that the provision of [section] 7(c) for temporary certificates was meant to cover a narrow class of situations, to permit temporary and limited interconnection, or expansion of existing facilities in order to meet such emergencies as breakdowns in the service of operating natural gas companies, or sudden unanticipated demands.”) (citing Algonquin Gas Transmission Co. v. FPC, 201 F.2d 334 (1st Cir. 1953)).

[6] Algonquin Gas Transmission Co., 201 F.2d at 341.

[7] Spire STL Pipeline LLC, 176 FERC ¶ 61,160 at P 10.

[8] Id. (quoting Consumer Fed’n of Am., 515 F.2d at 353).

[9] Spire STL Pipeline LLC, 176 FERC ¶ 61,160 at P 11.

[10] See Penn. Gas & Water Co., 427 F.2d at 575 (“Nor may an agency take precipitate action without a hearing on the ground that it can always cancel out and reconstruct if so advised after hearing.  To act in haste, repent at leisure, is not a sound motto for an administrative agency.”).  

[11] See, e.g., Commission Staff September 7, 2021 Notice of Applications and Establishing Intervention Deadline in ANR Pipeline Company Docket No. CP21-488-000 (21-day comment and intervention deadline); Commission Staff September 1, 2021 Notice of Amendment to Application and Establishing Intervention Deadline in Roaring Fork Interstate Gas Transmission, LLC Docket No. CP21-462-000 (21-day comment and intervention deadline); Commission Staff August 26, 2021 Notice of Application Establishing Intervention Deadline in Diversified Midstream, LLC Docket No. CP21-484-000 (21-day comment and intervention deadline); Commission Staff August 26, 2021 Notice of Petition for Declaratory Order in Northern States Power Company Docket No. CP21-486-000 (21-day comment and intervention deadline); Commission Staff August 2, 2021 Notice of Applications and Establishing Intervention Deadline in Rover Pipeline, LLC Docket No. CP21-474-000 (21-day comment and intervention deadline).  I recognize the Commission can and has noticed applications for shorter or longer comment periods; however, given that the Commission wants to avoid the shutdown of the pipeline, which could have occurred as early as August 13, 2021, it was unwise for the Commission to notice the application for longer than its standard practice.   

[12] It is worth noting that prior to the notice’s issuance, the Public Service Commission of the State of Missouri requested that the Commission take expedited action.  See Missouri Public Service Commission July 30, 2021 Comments at 1, 4.  Several other commenters requested prompt consideration.  See, e.g., State of Missouri Senators Mike Cierpiot and Karla May August 3, 2021 Comments at 2.    

[13] Spire’s application for a temporary emergency certificate, or in the alternative, a limited-term certificate is in Docket No. CP17-40-007.  This order is issued under the sub-docket -009.

[14] Spire STL Pipeline LLC, 176 FERC ¶ 61,160 at P 11.

[15] 15 U.S.C. §§ 717f(c), (e).

[16] 988 F.2d 146 (D.C. Cir. 1993).

[17] It is something akin to an article of faith among FERC Commissioners and staff that the Chairman has unilateral authority over litigation positions, though that power is not unambiguously conferred by the Department of Energy Organization Act and it has never been tested in court.  Regardless, the Commission has had a longstanding practice of recording the votes of the commissioners on major litigation decisions.  These are typically the subject of litigation memoranda from the FERC solicitor’s office and, in the past, the votes of the various offices were recorded by the Secretary.  Recently, at the direction of the Chairman, this practice has been abandoned.  I would like to see the Chairman reinstate it. 

Indeed, in a recent proceeding, the majority chided me for a dissent that pointed out language in a legal brief from a separate case that I believed was inconsistent with the majority’s reasoning in that case.  See Cent. Hudson Gas & Elec. Corp. v. N.Y. Indep. Sys. Operator, Inc., 176 FERC ¶ 61,149, at P 31 n.64 (2021).  The majority cited judicial opinions reminding litigants that it is the Commission’s “institutional decisions—none other—that bear legal significance” to argue that language from an appellate brief is in no way controlling.  Id. (quoting Pub. Serv. Comm’n of N.Y. v. FPC, 543 F.2d 757, 776 (D.C. Cir. 1974)).  The decision the majority cited defined “institutional decisions” as “a decision by a majority vote duly taken.”  Pub. Serv. Comm’n of N.Y., 543 F.2d at 776.  Given that only such decisions “bear legal significance,” the Commission’s (now former) practice of seeking the views of the body on agency litigating positions was a prudent one—the judiciary ought to have the confidence that the positions argued before it are, in fact, the positions of the Commission as an “entity apart from its members.”  Id.  

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